Sorting out my situation ...

[A.Rocketblast]

I have quite a few debts, totalling about £50k.

 

I have several credit cards that I have defaulted on and a CCJ of a debt related to bank charges that I didn't manage to reclaim. The CCs were defaulted about 4 years ago, the CCj was about 3 years ago.

 

I'm paying £50 a month on the CCJ and have paid nor contacted any of the debt collectors for 3 years.

 

My marriage collapsed at about the same time and I have been living in rented accommodation since. I'm looking to get back into home ownership-there is a possibility I can by my ex-wife's share of the house, if I can raise the funds (about £70k).

 

I guess no lender will go near me with my credit history, so I'm looking into clearing up the situation.

 

My thinking is that I could offer each of the debt collectors 10% of what I owe in full and final settlement, and the same with the CCJ.

 

If I do this, and this is accepted by the DCAs, will it be enough to enable me to get a mortgage again?

 

I get letters often from Lowells and Kapita. The solicitors I need to deal with about the CCJ are DCSolicitors- HSBC.

 

 

Thanks for your help,

 

Mike

[Stigman]

Before offering anything, you need a copy of your Credit Reference Files to see what is listed, what debt is owned by whom etc.

 

You can have free trials with both Equifax and Experian but remember to cancel within 30 calender days or your card will be charged up to £14.99pcm.

Alternatively, you can order by post enclosing a £2 postal order/cheque, the application forms are on both of their websites to download if needed.

Noddle owned by Call Credit is free but it can be outdated and because this is the least Credit Reference Company of the three, Noddle can be outdated so do not fully rely on it.

 

If you can start a new thread with each debt then this makes it easier for everyone.

State what the debt is, when last payment or written acknowledgement was made, if the debt has been sold, any PPI or charges that could be reclaimed (except the CCJ).

 

Except the CCJ, have you ever sent any CCA requests if applicable?

 

Do not contact by telephone, always keep everything in writing so you have a paper-trail.

 

Stigman

[havinastella]

If these were defaulted 3 years ago, you will no chance of a mortgage (unless sub prime) for at least another 3 years.

[scouserat]

*LONG POST ALERT*

 

This advice is offered from my own experience with an ex-partner who I helped sort out her financial situation

and she was in similar circumstances to you, albeit hers where only approximately £37K and minus the CCJ.

 

I'm assuming the house is going up for sale, and it's not a case of your ex-wife just saying "if you want to buy me out you can".

 

I'd sell it and then split the proceeds with her accordingly.

I know it can be hard to let go of something like a house, but from a financial and emotional perspective it makes sense.

You'll be constantly reminded of her if you live there and if you get a new partner

they'll be fairly reluctant to live there as well, but that's something else altogether.

 

Now your finances need the boost so take the £70K.

 

Get breakdowns from all the creditors or DCAs of exactly how they've arrived at the figure

and also request CCAs (no CCA no debt) and assignment of debt if they've bought it.

 

Do all this in writing (keep copies of what you send, obviously), and don't try and handle it over the phone.

A lot of DCAs are highly skilled in the art of "misdirection" so it's generally a good idea to get everything they're stating in writing as it's also legally binding then.

 

Once you have those, sit down and see how many of these are penalty and late payment charges.

As a rule, a lot of these are unenforcable (although others on here can state which are and which aren't).

Charges added on by DCAs are not allowed as you have no contract with the DCA and they can't charge you for normal operating expenses either.

 

Subtract the charges from the amount of each debt, and then whatever you're left with is how much you owe.

 

Send letters to the creditors stating that you're willing to offer 20% of the revised amount that is owed.

You can try 10%, but I doubt that will be accepted as there's the possibility that they could end up losing money

especially if they've bought the debt.

 

My ex gave me permission to negotiate with her creditors over the phone, and with all of them I never went any further than 40%

and with all of them it was successful.

 

Remember, you negotiate up and then negotiate down.

See what the lowest amount they say they'll accept is, and then once you hit your threshold limit don't budge from it

and tell them it's that or nothing, and there's other creditors you could choose to pay off

- you'll be surprised how quickly they back down once they realise you won't budge and with the possibility of others getting paid.

 

Now this bit can be done over the phone, but get them to send it out in writing that the agreed amount will be considered full and final,

and that there won't be any attempts to recover whatever is left over.

Don't pay until you have these, and ensure you get a letter stating that the debt has been resolved.

 

On a side note, do not state that the money is from a house sale.

How you've got the money to pay them is none of their business at all.

If you want to say anything then simply say you've had a small windfall and don't say how much.

 

Once they know the money is from the sale of a house they can get extremely aggressive.

I slipped up in my first phone call with one of her creditors, but thankfully I refused to budge past the upper limit I set.

 

Of the £37K my ex owed I got managed to get one of the debts written off as they couldn't find the CCA,

a couple were statute barred, and after I'd stripped off charges and everything

she ended up owing £29K she ended up paying around £9.5K back!

 

Now I know renting can be a drag, but the question is whether you can get credit elsewhere (excluding DSL and PDL companies).

If you can't get credit easily, then there's no way on Earth you'll get a mortgage, unless you've suddenly started earning massive amount of money.

 

If you're in private accommodation and you're finding it too expensive then it might be worth approaching the council

and seeing if you can get on their waiting list, although it will be a long wait unless you're at risk of being homeless

and even then they tend to offer crisis accommodation, and

 

also see if they have a list of "approved" landlords.

These are landlords that the council have checked to make sure they're charging a fair rent,

and that are also pretty good at keeping on top of repairs.

 

My ex was a victim of domestic abuse so she managed to get a council place quite quickly,

but she was offered a list of "approved" private lets at the time.

 

Now I know that having a large amount of money in your pocket is very tempting to spend, but don't.

My ex wanted to get straight back on the property ladder, but considering she couldn't even get a mobile phone contract at the time,

there was no way she was going to get a mortgage.

 

I talked her into putting the remaining £30K (the amount she got for her share of the house was a lot more,

but she did have quite large a splurge) in a savings account and just forget about it for a few years.

 

She occasionally moved it about to ensure she was getting the best interest rates, but apart from that she didn't touch it.

Don't put in an account you can access easily, because you're more likely to succumb to using it for impulse purchases that you don't really need.

 

Doing this allowed her to keep it as a deposit, but she was also earning interest on it

(although not massive amounts) and if a lender can see that you can keep a large amount of money for a period of time

and not be tempted it adds to the fact that you've turned over a new leaf so to speak.

 

I've also heard that it doesn't do your credit score any harm as well, but can't comment definitively on this.

This all happened back in 2007, and in 2012 she was able to get a mortgage at a good rate,

and it really helped that she had a large deposit she could access easily.

 

I know this may be what you don't want to hear, but it's a fairly positive direction to move in.

You could probably use other means to sort out your situation in the short term,

but chances are you could end up back in the same mess again.

Yes, I agree it's going to take a while, but it's preferable to ending up back in the same position.

 

Sorry for the long post, and no doubt other caggers may disagree,

but it's a situation that worked for my ex and hopefully may be of help.

[A.Rocketblast]

Thanks for the replies, and Scouserat, there is no need to apologise for the long post. It was helpful and useful.

 

I take your point about living in the house where I lived with my ex. My friends have raised their eye-brows when I have mentioned this. Its more to do with keeping on the property ladder than anything.

 

Thanks for your post, Stigman, I'll start a new thread for each with the details. A couple of years ago I did use a free trial at the two CRAs, so I guess I'm into paying for online service this time. Its not bank breaking, for a month, though.

 

ScouseRat, you say "no cca, no debt" - but can I get the CRA files cleaned even though there is no CCA? I seem to remember reading a few years ago that a judge had decided it was ok for DCAs to mark your file in this situation. Though it is highly likely I've mis-remembered.

 

Thanks again,

 

Mike

[Stigman]

A couple of years ago I did use a free trial at the two CRAs, so I guess I'm into paying for online service this time.

 

ScouseRat, you say "no cca, no debt" - but can I get the CRA files cleaned even though there is no CCA? I seem to remember reading a few years ago that a judge had decided it was ok for DCAs to mark your file in this situation. Though it is highly likely I've mis-remembered.

 

You can apply for paper copies to be posted to you for £2 each, go to each CRA website and download the forms, send with a £2 Postal Order/Cheque.

 

You remembered correctly that the DCA/Original Creditor can continue to mark your Credit File, this was stated in a Judgement in the High Court and is also a true reflection of your Credit History.

Please note that regardless of any CCA, the debt does still exists but means that the DCA cannot go to Court unless an original Documentation (or after early 2007 a reconstituted agreement) is produced.

Also in some circumstances, some Original Creditors/DCA's continue with collection activity (letters etc).

 

Stigman

[A.Rocketblast]

Thanks for the clarification, Stigman.

 

Well, I've started - SAR sent to HSBC yesterday. I'll do a couple of CCAs today.

 

I'll start new threads when I get a reply.

 

Thanks again,

 

Mike